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DaVita HealthCare Partners Inc (NYSE:DVA)
Beneish M-Score
-2.63 (As of Today)

The zones of discrimination for M-Score is as such:

An M-Score of less than -2.22 suggests that the company is not an accounting manipulator.
An M-Score of greater than -2.22 signals that the company is likely an accounting manipulator.

DaVita HealthCare Partners Inc has a M-score of -2.63 suggests that the company is not a manipulator.

DVA' s 10-Year Beneish M-Score Range
Min: -3.52   Max: -0.76
Current: -2.63

-3.52
-0.76

During the past 13 years, the highest Beneish M-Score of DaVita HealthCare Partners Inc was -0.76. The lowest was -3.52. And the median was -2.61.


Definition

The M-score was created by Professor Messod Beneish. Instead of measuring the bankruptcy risk (Z-Score) or business trend (F-Score), M-score can be used to detect the risk of earnings manipulation. This is the original research paper on M-score.

The M-Score Variables:

The M-score of DaVita HealthCare Partners Inc for today is based on a combination of the following eight different indices:

M=-4.84+0.92 * DSRI+0.528 * GMI+0.404 * AQI+0.892 * SGI+0.115 * DEPI
=-4.84+0.92 * 0.9993+0.528 * 1.0369+0.404 * 0.9554+0.892 * 1.0888+0.115 * 1.0139
-0.172 * SGAI+4.679 * TATA-0.327 * LVGI
-0.172 * 1.0302+4.679 * -0.0503-0.327 * 0.9848
=-2.63

* All numbers are in millions except for per share data and ratio. All numbers are in their own currency.

This Year (Mar15) TTM:Last Year (Mar14) TTM:
Accounts Receivable was $1,675 Mil.
Revenue was 3287.965 + 3328.017 + 3251.824 + 3172.489 = $13,040 Mil.
Gross Profit was 925.353 + 961.556 + 925.29 + 925.951 = $3,738 Mil.
Total Current Assets was $4,301 Mil.
Total Assets was $18,367 Mil.
Property, Plant and Equipment(Net PPE) was $2,501 Mil.
Depreciation, Depletion and Amortization(DDA) was $602 Mil.
Selling, General & Admin. Expense(SGA) was $1,319 Mil.
Total Current Liabilities was $2,680 Mil.
Long-Term Debt was $8,380 Mil.
Net Income was -110.617 + 208.02 + 184.122 + 147.683 = $429 Mil.
Non Operating Income was -0.533 + 0.229 + -1.246 + -95.855 = $-97 Mil.
Cash Flow from Operations was 410.089 + -69.991 + 847.9 + 262.391 = $1,450 Mil.
Accounts Receivable was $1,540 Mil.
Revenue was 3042.776 + 3063.209 + 2999.586 + 2871.673 = $11,977 Mil.
Gross Profit was 863.004 + 935.377 + 904.252 + 857.353 = $3,560 Mil.
Total Current Assets was $3,707 Mil.
Total Assets was $17,398 Mil.
Property, Plant and Equipment(Net PPE) was $2,224 Mil.
Depreciation, Depletion and Amortization(DDA) was $545 Mil.
Selling, General & Admin. Expense(SGA) was $1,176 Mil.
Total Current Liabilities was $2,566 Mil.
Long-Term Debt was $8,072 Mil.



1. DSRI = Days Sales in Receivables Index

Measured as the ratio of days’ sales in receivables in year t to year t-1.

A large increase in DSR could be indicative of revenue inflation.

DSRI=(Receivables_t / Revenue_t) / (Receivables_t-1 / Revenue_t-1)
=(1675.182 / 13040.295) / (1539.728 / 11977.244)
=0.12846197 / 0.12855445
=0.9993

2. GMI = Gross Margin Index

Measured as the ratio of gross margin in year t-1 to gross margin in year t.

Gross margin has deteriorated when this index is above 1. A firm with poorer prospects is more likely to manipulate earnings.

GMI=GrossMargin_t-1 / GrossMargin_t
=(GrossProfit_t-1 / Revenue_t-1) / (GrossProfit_t / Revenue_t)
=(961.556 / 11977.244) / (925.353 / 13040.295)
=0.29722915 / 0.28666146
=1.0369

3. AQI = Asset Quality Index

AQI is the ratio of asset quality in year t to year t-1.

Asset quality is measured as the ratio of non-current assets other than plant, property and equipment to total assets.

AQI=(1 - (CurrentAssets_t + PPE_t) / TotalAssets_t) / (1 - (CurrentAssets_t-1 + PPE_t-1) / TotalAssets_t-1)
=(1 - (4300.795 + 2500.596) / 18366.663) / (1 - (3707.233 + 2224.439) / 17398.342)
=0.62968826 / 0.65906682
=0.9554

4. SGI = Sales Growth Index

Ratio of sales in year t to sales in year t-1.

Sales growth is not itself a measure of manipulation. However, growth companies are likely to find themselves under pressure to manipulate in order to keep up appearances.

SGI=Sales_t / Sales_t-1
=Revenue_t / Revenue_t-1
=13040.295 / 11977.244
=1.0888

5. DEPI = Depreciation Index

Measured as the ratio of the rate of depreciation in year t-1 to the corresponding rate in year t.

DEPI greater than 1 indicates that assets are being depreciated at a slower rate. This suggests that the firm might be revising useful asset life assumptions upwards, or adopting a new method that is income friendly.

DEPI=(Depreciation_t-1 / (Depreciaton_t-1 + PPE_t-1)) / (Depreciation_t / (Depreciaton_t + PPE_t))
=(544.928 / (544.928 + 2224.439)) / (602.159 / (602.159 + 2500.596))
=0.19676988 / 0.19407236
=1.0139

6. SGAI = Sales, General and Administrative expenses Index

The ratio of SGA expenses in year t relative to year t-1.

SGA expenses index > 1 means that the company is becoming less efficient in generate sales.

SGAI=(SGA_t / Sales_t) / (SGA_t-1 /Sales_t-1)
=(1319.246 / 13040.295) / (1176.136 / 11977.244)
=0.10116688 / 0.09819755
=1.0302

7. LVGI = Leverage Index

The ratio of total debt to total assets in year t relative to yeat t-1.

An LVGI > 1 indicates an increase$sgai= in leverage

LVGI=((LTD_t + CurrentLiabilities_t) / TotalAssets_t) / ((LTD_t-1 + CurrentLiabilities_t-1) / TotalAssets_t-1)
=((8380.153 + 2679.516) / 18366.663) / ((8071.622 + 2566.174) / 17398.342)
=0.60215996 / 0.61142585
=0.9848

8. TATA = Total Accruals to Total Assets

Total accruals calculated as the change in working capital accounts other than cash less depreciation.

TATA=(IncomefromContinuingOperations_t - CashFlowsfromOperations_t) / TotalAssets_t
=(NetIncome_t - NonOperatingIncome_t - CashFlowsfromOperations_t) / TotalAssets_t
=(429.208 - -97.405 - 1450.389) / 18366.663
=-0.0503

An M-Score of less than -2.22 suggests that the company will not be a manipulator. An M-Score of greater than -2.22 signals that the company is likely to be a manipulator.

DaVita HealthCare Partners Inc has a M-score of -2.63 suggests that the company will not be a manipulator.


Related Terms

Altman Z-Score, Piotroski F-Score, Accounts Receivable, Revenue, Gross Profit, Total Current Assets, Total Assets, Property, Plant and Equipment, Depreciation, Depletion and Amortization, Selling, General & Admin. Expense, Total Current Liabilities, Long-Term Debt, Net Income, Non Operating Income, Cash Flow from Operations


Historical Data

* All numbers are in millions except for per share data and ratio. All numbers are in their own currency.

DaVita HealthCare Partners Inc Annual Data

Dec05Dec06Dec07Dec08Dec09Dec10Dec11Dec12Dec13Dec14
DSRI 1.35240.66560.92271.07790.95280.93161.05270.980.72560.9446
GMI 1.0291.03370.96031.03451.00941.0570.92430.98031.0491.0551
AQI 1.25910.98160.95770.97230.97360.96961.09211.20850.95170.9663
SGI 1.36591.64121.07861.07521.07931.01811.08241.21611.4371.0876
DEPI 1.26250.81270.99160.9960.99891.02921.06071.01340.79851.0063
SGAI 1.06041.05641.00420.75280.9691.05661.10631.06870.920.9859
LVGI 1.15070.9230.9210.96320.91551.04920.98631.03010.96020.9412
TATA -0.0418-0.00060.0041-0.0346-0.0328-0.0447-0.0792-0.0348-0.0669-0.0357
M-score -1.93-2.21-2.48-2.44-2.58-2.74-2.74-2.41-2.65-2.58

DaVita HealthCare Partners Inc Quarterly Data

Dec12Mar13Jun13Sep13Dec13Mar14Jun14Sep14Dec14Mar15
DSRI 1.01510.94840.85540.77050.72710.77550.88170.92890.94460.9993
GMI 1.03471.05921.07781.06931.04881.05891.0461.04951.05711.0369
AQI 1.2081.1921.1611.07130.95090.95670.92940.94320.96630.9554
SGI 1.17151.26221.35151.461.4371.30911.21671.1261.08761.0888
DEPI 1.01340.93110.85490.79980.79850.86650.93230.99811.00631.0139
SGAI 1.21071.12880.87850.87590.840.84410.95370.95060.98011.0302
LVGI 1.03081.0481.04410.98320.96020.94650.96630.95970.94120.9848
TATA -0.0348-0.0435-0.04-0.0614-0.0669-0.0593-0.0558-0.0588-0.0357-0.0503
M-score -2.42-2.43-2.39-2.50-2.63-2.65-2.65-2.68-2.58-2.63
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